Help & advice needed for a newbie!

5 Posts
Hi all,
I'm new so please be gentle!
I need some help and advice with a big problem.
I set up a small business a while ago and now (unfortunately:( ) owe someone else who runs a small business quite a few thousand pounds. We have only ever had an informal agreement so asking for records of monies owed probably isn't going to get much of a response! To cut a long story short I have made an offer of payment (2.5% of the total owed to be paid monthly), which is as much as the business can afford, but the other party is not willing to accept this and wants to start legal proceedings to take me to court. I have been paying them this amount anyway for a while now, but things just keep getting worse.
The questions I have are:
1) I understand they have the right to take me to court, but what obligation are they under to accept my offer of payment?
2) Will they be able to sue me personally for the debt as the business doesn't really have any assets? If so, what will the procedure be?
3) Can they get a charging order on my house straightaway to repay the debt, or are there other options such as CCJs?
Any other help and advice anyone can give would be fab as I'm tearing my hair out here! (and yes, staying up til the early hours typing on forums probably doesn't help
)
S x
I'm new so please be gentle!
I need some help and advice with a big problem.
I set up a small business a while ago and now (unfortunately:( ) owe someone else who runs a small business quite a few thousand pounds. We have only ever had an informal agreement so asking for records of monies owed probably isn't going to get much of a response! To cut a long story short I have made an offer of payment (2.5% of the total owed to be paid monthly), which is as much as the business can afford, but the other party is not willing to accept this and wants to start legal proceedings to take me to court. I have been paying them this amount anyway for a while now, but things just keep getting worse.
The questions I have are:
1) I understand they have the right to take me to court, but what obligation are they under to accept my offer of payment?
2) Will they be able to sue me personally for the debt as the business doesn't really have any assets? If so, what will the procedure be?
3) Can they get a charging order on my house straightaway to repay the debt, or are there other options such as CCJs?
Any other help and advice anyone can give would be fab as I'm tearing my hair out here! (and yes, staying up til the early hours typing on forums probably doesn't help

S x
0
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Replies
1. Do you have any documentation at all regarding the debt? Invoices etc?
2. Is your company a limited registered co, or are you a sole trader.
Both these things will make a difference to the answers...
LB moment - March 2006. DFD - 1 June 2012!!! DEBT FREE!
May grocery challenge £45.61/£120
Hi,
1) None whatsoever. It has all just been verbal.
2) Sole trader
S x
As a sole trader, you may be personally liable, I believe. Limited company status would give protection from personal assets being targeted, except in criminal cases (Proceeds of Crime Act).
Depending on the amount, if you can prove to a judge that you are genuinely making efforts to pay, and produce a statement of accounts to show it is all you can afford, then he/she is more likely to grant a payment order, than put you in a position where you cannot live or work- how can you pay then?
I could be wrong, and you should seek advice from the CAB legal lot, but if he has no proof the work was done for an agreed price or on agreed terms, how can he sue you? A verbal contract should be respected, but the judge can only hold so much of it to account.
I hope this helps, but get some proper advice!! Good luck x
LB moment - March 2006. DFD - 1 June 2012!!! DEBT FREE!
May grocery challenge £45.61/£120
Will try CAB later this week - hopefully they can clarify a few things further!
S x
As a sole trader you are personally liable but I cannot understand why you have had such an informal agreement in place?